hello, i'm adam shapilo. we are bringing you hourly updates on the negotiations to avert the fiscal cliff. we want to check u.s. futures to see how investors are anticipating the last trading session of 2012. investors seem to be optimistic that a deal will be struck. you can see the dow futures as well as the s&p 500 futures are looking up. rich, there are several things to discuss. is there any chance of a deal tonight or everybody packed up and gone home? >> everybody has packed up and gone home except for joe biden and mitch mcconnell, they are having multiple conversations and these folks are running point on negotiations, harry reid who was negotiating has left the capital.

so those negotiations have died throughout the remainder of today or earlier today. you have the vice president and senate minority leader. the last time they finished the deal the tax deal we got a couple years ago that extended tax rates, cut the social security tax by a couple points. all of that ongoing right now and that is really the last hope we have to get something done before the fiscal cliff. >> does the minority leader and the senate, do they concur with the house of representatives. because it's eventually going to have to go through the house? >> absolutely. they would remaining in contact. just to make sure that the house would be agreeable to whatever the senate minority leader put out. democrats would have to be apprised of that as well but any agreement is probably going to need democrats in the house of representatives. the house is also working on a number of procedural maneuvers

tonight to pave the way for quick votes over the next few days. they are not actively involved in the negotiations but if these two are to get a deal, vice president and senate minority leader the house could do a quick vote. >> two other things, first, if they don't do a deal, what can the average american, expect as far as tax increases? >> the average american could and not up and down the income sale. bush tax cuts created lower tax brackets for lower income americans, so up and down you would see specific tax increases not just on wealthier americans. >> and this doesn't have to do anything with to do with fiscal cliff but there is news on hillary clinton? >> doctors have discovered a blood clot stemming from a concussion she sustained several weeks ago they are monitoring

the medication they are over the next couple of days. >> i guess she won't be testifying in front of any senate committees. rich, live for us. we'll check in with you at 9:00 p.m. and update you on behind the scene negotiations. we're going to update how asian markets are trading with no deal here in the united states. so until 9:00 p.m. have a great day. you'd you would think that you'd want to havewa assets available within a certain distance of, bt places. but there is no sign anywhere that we would ask any help fromo neighboring countries, anyone else in the vicinity to help us at thattime. have puthese people in this situation ,-com,-com ma they have failed to connect the dots and failed to anticipate what was happening and once th attack began, there was something they could do immediately, but have they

responded immediately, might have prented the deatthat occurred seven hours lat. lou: it is interesting to me that those who s this was at the level of assistant secretary for both diplomatic personnel security for diplomatic personnel as well as for embassies and the head of security and that should be it. they have resigned, they were forced to resign as a result of these lapses. obviously you disagree with that. >> it is very hard to actually fire somebody in the state department, they have to show willful negligence, so gross incompetence isn't enough to fire someone o is working there for the government. you think about that aspect of it. but we have to hear from secretary clinton, as secretary of state, come a testify in person and on the record.

there are a lot of questions and today's hearing added two more questions. lou: do you think they wl be answered here? secretar clinton has said she will testify before mid-january, which would be before the inauguration, and presumay in an effort to satisfy the senate. your thoughts. >> i think it is critical she does that for her own credibility ani think she wants to testify but there are many tough questions that need to be answered for what the secretary of state was was doing as well as the presidentf the united states was doing. did the president know about these requests? the narrative was al qaeda is on the run. we see al qaeda linked terrorists were actually training in eastern libya not far from an ghazi, that seemed to be a hotbed training area for those folks and makes you wonder if the state department liev the president's own press releases rather than what they

should have seen on the ground, they shod have been connecting the dots and they failed miserably. lou: pointg out directly al qaeda is far from dead andloe benghazi terrorist attacks. whether it amounts to a whitewash. joining us now is judh miller, former u.s. amassador to the united nations, john bolton. thank you both for being here. i would like to start with a couple of the finding from the executive summary of this report. these two findings occur ith one paragraph. first, embassy tripoli did not demonstrate strongand sustained

advocacy with washington for increased security for special mission in benghazi. that means the onsulate. lou: here's the other binding after one paragraph. in the days and months and weeks leading up to it, wer inadequate. despite repeated requests and special mission in benghazi and embassy tripoli for additional staffing. judith miller, reconcile what wadirectly contradictory findings within a ragraph of one another. >> secretary of state clinton is going to have to answer that question. i think this is an incredibly damning report about the administration. the behavior and security posture in benghazi. questions are going to be asked and they will have to be

entered. lou: whitewash an incredibly damning report. ambassador bolton? >> we don't know if it named any names like ttree people who was resigned today, but i can tell you that we had a lot of jobs that the state department posted. when someone is going to take the fall of the departmentthat is the price that they take. i can't tell you, they can't read this report are not included the secretary of state and the top people were either completely asleep at the switch were utterly unaware of what was going on in libya and the broader middle east. or maybe some commendation of bo. lou: i want to challenge you bo, if i may. out of deepest respect. i am fond of you both. but i didn't learn a single new thing in this report that i haven't already been a fanof. frankly iam stunned to see that

there is no naming of individuals responsible. there is a failure here to talk about the video. the real-time video from of the facility and from the jonah was in the air within two hours of the event. i am stunned to see that there is a whitewash of a decision making but refused to send u.s. forces to defend benghazi and thmissing ambassador. i am stunned at those omissions. >> well, i think that there wasn't enough time to ve add military support for those people who were trapped at the annex, as opposed to the consulate. but i think that you are right about this. all ofhe questions or many of the estions that you and others on fox news have been asking were not answered by this

report. what i found personly depressingbout this report was the repetitionf failures that we have seen since the marin compound bombing in lebanon in 1983. how much time doesit take for the state department and the u.s. government learned that you need arabic speakers on the ground? or that you need addedsecurity cameras on the ground. for that you need enough people to protect your people on the ground. we have gone over this again and again. the state dertment oesn't seem to learn it, and that is where i think larry clinton is going to have a problem speng ambassadorolon? >> wn they talk about systemic failure, you have to say who is in charge of the system. the system, the captain of the state is the secretary of state. maybe they didn't want to say that, and maybe a panel didn't mean to say that that is the inescapable conclusion of that lonn litany of failures. and i think that whilehe scope of this report is very limited,

it lays a basis for congress to go forward. i think that we shouldn't link at the clear and sharp, unambiguous statement. there was no donration in benghazi. they knew from the get-go that this was a terrorist attack. lou: you can cut this any number of ways that you want to in this administration. the american people wre lied to. ey were like two fromhe outset of this tragedy. these terrorist attacks are still being lied about whether directly or a mission, as far as i am personally concerned. ambassador, i want t interject something to yo if i may. there is a phrase of the week on this broadcast. thing the state department on tuesy dismissed john bolton's assertion that secretary of state hillary clinton have faked an injury and illness about the libyan terrorist attack.

here's what ambassador bolton said. every foreign service officer in every foreign minister in the world knows the phrase when you don't want to go to a meeting or conference or an event, yu have a diplomatic ilness. this is a diplomatic illness. thank you both for bei iljudith miller among our gifts. >> suddenly fiscal cliff is looking steeper and closer. noted economistst arthur lapert joins us to tell us how this game

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>> is very sad, but this legislation is what is said. the legislation has the expiration of the tax cuts after 10 years. if nothi is done, all tax rates go up. what you see happening allowing some of them to go, all of them to go up, it is a verydifficult situation for speaker boehner and the house republicans to be in. i feel very soy for them. they a caught in a trap.

lou: a trap, a conundru that was perfecy visible. it was transparent where w would be. and the republicans, the republican leadership, the republican national committee. all of the so-called wise men and women of the party did absolutely nothing to prepare for this strategic moment, and they are coming up woefully short. >> that's very true. you knew it happened 10 years ago when there was a provision that this was going to happen. here it is. i think the key for the republicans from my standpoint is to get this over with as quickly as possible. the serious business of trying to prevent spending increases and other programs. without giving up the position of republicans and being able to get those tax cuts. we will have an awful 2013 and

2000 putting him and i think the republicans could take over the senate and increed the majority of senate and house if they don't give up their key issue, tax cuts. u: there has been no talk of growth in this economy. john boehner, the republican leadership, those who are leaving the party, there has been no talk there will beno tax hikes. unwilling and unable perhaps, for what will ensue of the fiscal cliff. but the fact is that we are looking at a real prospect that the republicans will be held responsible and must plan be actually hashe effect of shifting some of the responbility to the president read what you thinkre the odds? >> i think he will be held responsible for the economy in 2013 and 2014.

you cannot blame george w. bush anymore. they conol the senate. it is their economy for sure. so i think that you're going to sea real problem in 2013 and 2014, but i do think it's obama's economy now. the republicans passed the tax cuts for one group, let's say all the wy through, not the very top group, , i don't know where that negotiation is going to come out, but if they do that, i think that they will be held blameless for the economy. lou: as we wrap up here, i would like to ask you a question this way. because i said last year that i felt strongly at the beginning of the campaign. the democrats were the repuican -- the democrats or the republicans, which party led the discussion to the enduring that of the middle class

sure enough, president obama shifted to a middle-class message that resonated, if only at the margin that was sufficient for victory. are the republics learned anything here? are they going to start talking about working men and women? working class and the american dream. >> i think they are. i think the presidential race s a real problem. because it was never growth. it was aways about this and that and detail. romney wasn't the issue. the issue was obama. it was the worst single recovery in the u.s. that is the issue. i think and i hope the republicans take that agend and i know that -- let me just tell you personallyi know a lot of democrats who would like to get in that agenda as well. they want to lower rates, broaden the tax base.

there are a lot of democrats want to dot as well. if we can get the agenda in there, we are in for a great couple of years. 2015 and 2016 could be really good years. lou: all that is required is the faith and patience. >> that's right. we have a lot to reach. lou: abundant, abundant.eing thank you for coming to join us. art laffer. up next, a horrific new townacr massacre spurring calls for more gun control. in the "chalk talk" we take a look at what is potentially one of the largest and mostloe one f important problems in ourblem society.an it is not guns. the cost of mental health in so many dimensions [ male announcer ] how do you trade? with scottrader streaming quotes, any way you want. fully customize it for your trading process -- from thoug to trade, on every screen.

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s a the newtown massacre

lou: the newtown, connecticut, t massacre creates a debate on gu. control without question. but it is arguably more important to have a national discussion on mental health ar care.topic. very unpopular dtai topic. we still don't know the facts of a 20-year-old man turning into a mass murderer last friday, b we do know many ofa the factsout about a mental health care peop systemmthat is failing. there are far too many people that coulde productive in our society. but first, we need to tlook at the truthand dimension.ll just how big is mental illness in america? well, i ho you are sitting down. because these numbers are simply sounded very at according to the national institute, the national institute of mental health, 20%o

of this country, 20% of us at one time or another, some 60 million people, 60 million americans experience a mental health disorder in any given year. ve those, some 60 million peopli receive some form of help. despite the often desperate neec for care, it is almost twicea af difficult to find a mentala health professional to provide f your and find a doctor. extraori mental health care is extraoinarily expensive. twenty-five years ago, think about this.ju we were spending just over

$2 billion. on mental health medication. it is now more than 10 times that amount. $3billion. just for pharmaceuticals. nearly 50% of those who goco untreated now whecost is a barrier. t its 66% that say that they didrp not have trement. they hoped and prayed that the problem would get better on itso own. as we have learned through her psychological problems and mental illness, they often just@ get worse.

ite hous lou: leaders descending on the white house. the ceo of carl's junior anddy'o hardee's doesn't think the president isk listening. president isk listening. coming up this family used capital one venture miles to come home for the holidays. that's double miles you can actually use... sadly, their brother's white christmas just got "blacked out." [ brother ] but it's the family party! really jinglesour bells, doesn't it? my gift to you! the capital one venture card! for any flight, any time! that's double miles you can actually use! how illuminating. what's in your wallet? let me guess, am on the naughty list again? ho ho ho!

lou: a group of top ceos meeting with the president, saying thatt they were encouraged. my next guest says that raisingi tax rates will stiflell business growth and cost jobs. joining me now is the ceo that tod owns carl's junior and hardee's. it's great to have you with us.e >> it's good to be here, lou. lou: let's start with the idea taxes that this president wants $1.6 trillion in new taxes. that is a heck of an initial bargaining position, isn't it.> >> the president tks about tax rates.te he wants tax rate increases and he converted intodollars.x rev

the real question is can you raise tax revenues.se the only way that we wi raise enough revenues to get us out of trouble is private sectorsetor growth. tas you will not have private sectoc growth if you're saraying thate you're going too raise their health care costs or energy costs or labor costs. going t people aroe going to invest. ob you are going to find that job creation is unique. americ businesses want aess isio president to succeed. i didn't vote for him, but hisey success is tied to my success. t conversely, his success isied to the success of american bs business. there ought to be some common ground here. i'm just not seeing it yet. youh lou: what do you think of the idea that it doesn't ceos from companies show that the white house to talk g with the big ys, but small business thatf creates most these cuts represent a fraction of our economy. they have a major, major portion of the lobbying efforts and the pressure that is alied n washington. what is your reactio

>> these are good people, mart people, intelligent. but you really have to look at how rare motivated differently than smallbusinesses would be. these large businesses can be the subject of government actions. it's easy to kind of select them, move them out. they can be bject to attack. they also are sometimes subsidized. i have to worry about subsidies, and tt may have government contracts. small businesses aren't concerned with those things. small-business an make a much better case t the president as to what needs to be done in this economy to create jobs. what would it take for small businesses, businessman women to create jobs and grow the economy? he just is to ask. i think he would get a very consistent answer. he does need to keep talking to the same high-level executives that he has been talking to. tony's to get down into levels and talk to small businessmen women lou: let's you and i get to some brass tacks.

we are talking about raising the top rate. we're being dragged along. talking about almost 40 percent, raising the top rate to about 40%. we already see the top 2 percent paying about 50 rcent of all texas. i don't know what the impact wouldbe, but i do hae the sneaking suspicion that the president is not aware that the fact is, individual tax payments to this governmenthave risen by 25 percent under the bush tax rates over the past two years. and the real answer is staring him and everybody else in the face. that is, growth. >> yes. private-sesector growth is the only wy of this. the government has done everything it could possibly do. 800 milln in stimulus, interest rates in zero, printing money and it igoing in a style. the government has done what it can do. many the private sector. that tax rate, you're not adding

in the obama increase in petrol taxes. it's over 40 percent. that it's all businesses, subchapter s corporations, elsie's. the larger corporation, the corporate tax rate goes down. that makes them feel good. the businesses that will be hit by these tax increases are the very small and midsize businesses that reate jobs same people that get hit with obamacare, the energy increases, and a labor cost increases. lou: wt if i told you that it makes some sense. give him at the margin what he wants on taxes. whether that's on investment tax , camping deductions. sically what mitt romney was proposing. get that done. then say what you going to do? you going to still be left if you roll all of that up.

you will still be left with a huge deficit. it's going to have to mean cutting the federal budget. >> even if we increase the tax rates, the top 1 percentn this country makes seven timbers of the income. 37 percent of the taxs. so a fa share argument really is it -- lou: you're getting a again start out here. your last shot. >> mr. president, please, please work wit the business community. we want you to succeed, but you're putting impediments in is next.nd make impossible. the thin line between video and reality, talking with a man who knows th line and exploits it to train ou military, nd h says some brutally violent video games can turn some ids int killers. colonnl dave grossman with us next. copd makes it hard to breathe,

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guest to says guns are not the real problem. kids arebecoming so desensitized to violence and to death because of violent video games that we are injuring our young people. in some cases previously. the foremost experts on violence and media. lieutenant-colonel david rosen, former psyhology professor at west point and author of, killinthe psychological cos of learning to kill and war and in society it is good of you to be here, colonel. want to start with the idea that is now being discussed right now. there is some discussion. obviously a reflection which is, take away the guns, the reflexive answer which, it had to be simpla psyclogical

problem, part of one young man. you see it as a much more broad and profound problem than even that. >> the first thing is, this is a worldwide phenomenon. germany had to mass murders of high-school. england, 30 years after the most rigid gun laws passed, they have their mosthorrible gun massacre. norway, some of the most strictest gun laws on the planet, and that got on the island and murdered all of their kids. we have to understand something new is happening. the guns have always been there. we're working rd to keephem out of the hands of kis, but there is something profndly new. if we don't focus on that e completely iss the issue here. lou: what is that new -- that change that is overtaking us, oursociety that can leadto this kind --

>> a n phenomenon. lou: what is it? >> never there before. violence injry, particularly video games. the number one trade law enforcement. man-hours, contact our supply system anywhere you want to measure it. one of the leading trainer is a military. i have a best-selling video series were preparing individual citizens to be able to use deadly force at the moment of truth. and from all those perspectives, we know that simulations and visualization and mental rehearsal is absolutely essential to performance on the battlefield. the video games are providing the exact same thing to the children without the safeguards. and thenhen you add the ingredient of children who have any difficulty, autistic children, mentally ill children, the learning disabled children, the impact is even greater. i work with schools nationwide. i do school safety training

acrossmerica. it is heartbreaking when the special ed teachers come up to you and ta about how their precious special lead children are so horribly influenced by these violent movies in these worst of all, you have an apparent overwrought, overwhelmed with a disabled or emotionally ill child, and they turned to the video games to escape. the video games are addiive, seductive. they create sleep deprivation. sleep deprivation is major factor mental illness, depression, an suicide. video games are a major factor in suicides. we see it in military. our military suicides and we begin to realize sleep deprivation is a critical factor in suicides, and video games are key factor in this deprivation . lou: samuel l. jackson, one of the stars in this movie. i don't know how to say itt, the one in which jamie fo said he is to kill white people.

by the way, interesting to think what would have been the reaction had white actor city is to kill black people. to the point, samuel l. jacson disagrees that this is not about people going to movies or video gamesthat have volence in them. does not have anything to do with it. what would you say? >> when we take an individual who is on the able one way or the other end there are illions and millions of people like that in america today. youth theater and the sickest video games and movies jonesboro middle school, virginia tech, now giving a sell as adults in our movie theaters and schools. the mass murders, the "wall street journal" article, the mass murders are skyrocketing across america and across the planet. this is a worldwide phenomenon. there is only one new factor in

the equation, all of the old prlems are still there, still important. but the new factor is the death and were fed to our children. the sickest movies and this is video games are very, very sick indeed. lou: with you think the odds are , colonel, that president obama, members of his party, and congress in particular will then call for an intensive investigation and examinatn of media and hollywood and their role in treating this kind ofof environment. >> i think the odds of hollywood doing it -- the odds of this president's doing an intensive study and an intensive investigation of the impact of the of namee in hollywood are slim to none. the tired old-- eaning it's not going to happen. we will see, what is the tired old, the red herring being dragged across the path again.

it's all about the guns. it's the mantra. when they refused to point the camera at themselves. lou: they're going to do exactly that and a point the camera at themcontinue this discussion, and we're going to continue what he sure to be a significant national discussion. you postedd updated next. the sandy hook massacre. tonight we focus on america's mental health proble and issues in the lou dobbs for him. what can be progressive direct and other car insurance companies? yes. but you're progressive, and they're them. yes. but they're here. yes. are you...? there? yes. no. are you them? i'm me. but those rates are for... them. so them are here. yes! you wanto run through it again? no, i'm good. you got it?

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lou: we want to begin by showing you a new poll, a survey showing the number of americans, majority of americans believe the most effective ways to prevent mass shootings are creased police presence, 53%, followed by an increase on the focus of mental health care, 50%. no gun control at that point. number four in this survey. joining us, psychotherapist, psychologist, also profsor. >> we know what we're talking about. lou: good to have you all. people are strugglinwith here is the reflex first, ban all guns.

washington, d.c., blazed with that idea. the american people in survey after survey, thinking a thoughtful approach to this ar the politicians. what do you think about the idea we should pay more attention to mental health in this country? >> are usually supported. one of the things that would be helpful agreeing with mental health is the stigmatizing it. there is so much shame surrounding a mental illness when the fact of the matter is a large portion of our society has diagnostic code. and most of those people are not violent, i just have to say. ny people go without any issue. lou: those with a serious mental disorder. >> even if they have a serious mental disorder, most of them are not violent. a fraction of people who will always be violent and we have to

look at that and address that issue. but mostly people mentally ill are not violent, and it is really important not to confuse mental illness and violence and furthhr stigmatize a group that is already having a hard time acknowledging or scapegoating them. lou: this young man so clearly was mentally ill. i havealked with mental health officials who refuse to acknowledge that. they want to have these discrete judgments. your profession expressed by some in it would have these niceties rather than help for the young man or mother, one can only imagine how troubled that woman was, how much pain she was going through with her son. why is that? >> we really don't want to stigmatize people.

we need to acknowledge it s because of the mental illness that he acted out in the way that he did. and we're lookinggat something more than just a pervasive developmental disorder. a young man who fell into psychosis, i tru believe. lou: we will return to the doctors in just a moment and they will expand that they will expand that perspective here [ male announcer ] this is the a of knowing what you're made of. why let erectile dysfunction get in your way? talk to your doctor about viagra. ask if your heart is healthy enough for sex. do not take viagra if you takeitrates for chest pain; it may cause an unsafe drop in blood pressure. sideffects includheadache, flushing, upset stomach, and abnormal vision. to avoid long-term injury, seek immediate medical help for an erection lasting more than four hours. stop ting viagra and call your doctor right away

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♪ lou: we are back with dr. gardner and ludwig. i want to start by -- some who are speculating that his motherw

the shooters mother, who was tryingo commit him, that is what w triggered this horrible .assacre >> that could have. that could have. lou: why would a mother, apparent that feels that the pan child is a danger to himself or to them or to society, why in the world would she have gottenn him committed right away?commter >> maybe she was waiting. it's hard for me to imagine sher would not know how to do it. you i mean, the way you do it is you call the police and say tomyis son is a danger to and sell fore to me. i don't feel safe. pla they come to bring into a psychiatric hospital psychiatric hospital, they have him evaluated. if the determine it is accurate he is committed. >> a lot of kids are fing under the radar, they may not be deemed as being a danger to themselves and others, the don't commit them, if they don't they let them out in two or three days. lou: these tragic horrible

ories, carry so many commonalities, whether it is aura colorado or newtown,@ connecticut, tucson, arizona. >> we have to look at who is committing these crimes, they are young men in their 20s. and you know, they are often disenfranchized there is something slightly off with them. >> often alone. often had severe psychiatric histories, many on medication. but a lot of rage. and spend -- and everyone saying, eventually, we knew that guy was a time bomb waiting to go off. >> there is always something a bit off, and yeah -- lou: and society does not respond? out of a sense of political correctness or what. >> a sense of a person's civil rights. >> a lack of awareness. we're teaching men the way t